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Consumer advisory: Accessing your scholarships and student loan funds


The Consumer Financial Protection Bureau is issuing a consumer advisory today to all students expecting to receive scholarship and student loan proceeds onto – what appears to be – a school-endorsed debit card. We are also asking consumers to tell us about their experiences getting their financial aid funds.

Yesterday, the Federal Deposit Insurance Corporation, another banking regulator the CFPB works closely with, fined one of the largest providers of campus debit cards.

Many college students, especially those enrolled in community colleges or who live off-campus, receive scholarships, grants, and student loans that are for more than the cost of their tuition. These funds help them pay rent, get to and from school, and cover other costs, like textbooks. Many schools work with third-party financial companies to disburse these funds directly to students. Consumers should remember the following:

  • You can’t be required to use a specific bank or card. There may be a financial institution that operates on your campus, but you generally can’t be required to use a specific account or card to access your student aid. If you have received a federal student loan, your school must provide a paper check or cash option.
  • Consider choosing an account before arriving at school. Shop around, and don’t feel limited by the banks operating ATMs on or near campus. Some financial institutions don’t charge you for using any ATMs, and some will automatically reimburse you for fees charged for using an out-of-network ATM. Many institutions also provide a mobile phone app to remotely deposit paper checks.
  • If your school offers it, sign up for direct deposit as soon as possible. If your school offers direct deposit, you may be able to provide the school with your account information in order to access your funds more quickly.

If you have a specific problem with your student checking account and need to resolve it, please file a complaint with CFPB. If you want to just share your experience with student checking accounts and debit cards, tell us your story and use the tag “financial aid.” We’ll also share what we learn with the Department of Education, who recently published a notice on this topic.

Ask CFPB if you have more questions about student checking accounts.

Share this post on Facebook and Twitter, and we look forward to hearing from you.

  • Cosmos Human

    Thank you so much for your timely advisories.  Many students are not aware of the horrible fees associated with these “so called debit cards”.  The use of these “cards” put millions of dollars in the pockets of the banks and their executives.  Who know how much of a “cut” the school takes.  Shame on them for ripping off students!

    • Program Admin

      I can’t speak for all programs, but I do know that schools do not get a “cut” from any fees charged by Higher One. As someone working in school administration it is offensive that these preditory practices take place on students. However, it is equally offensive that so many young adults are lacking the proper financial education. Bottom line is that if young adults knew how to take care of their funds they wouldn’t ever incurr NSF fees. The fact that so many students allow accounts to go NSF that banks target it for profit is a sad statement on the finanical management of our youth.

  • Parent of College Student

    My daughter’s school just began using the HigherOne Debit Card.  If you already have an existing bank account with a credit union, bank, or other financial institution, you can have the funds directed from HigherOne to that account at no cost.  The instructions were included in the disclosure material as well as the website where we went to activate card.  We thought the instructions were very straightforward  and the process was simple.  You will need to have your bank account number and  routing transit number to complete the process.

  • Stephanie Robertson

    At San Antonio College in TX we are now being forced to use the Alamo Cash Card from Acceluraid. We are not recieving our funds on time and no one is being helpful or clear about the switch. I have no choice for a paper check or direct deposit. Is there anything I can do to fight for this????

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